Willingness to pay for lipid lowering: a health production function approach

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Abstract
This Paper reports the results of an experiment of measuring willingness to pay (WTP) for lipid lowering. WTP is derived from a theoretical model of health risk reductions, using a health production function approach. A survey of about 700 persons randomized into a lipid lowering trial in Sweden is used to estimate WTP. The willingness to give up time (WTGT) to take part in a lipid lowering programme is also measured in the survey, to assess its relationship to WTP. The response rates on the WTP and WTGT qusetions are 94% and 96%, respectively, and the patients are on average perpared to pay about Skr 350 per month or devote about 5 h of leisure time per week to get normal lipid levels. The Correlation of WTP and WTGT is 0.45 and highly significant. The results of regression of WTP and WTGT are in accordance with the theoretical predictions with a higher valuation for a greater perceived difference in health status with and without treatment. The income elasticity is also positive as expected.